they spread your message through their networks, acting like word of mouth on steroids.

defend your brand when others complain

answer consumer questions and share satisfaction about your brand

influence others to buy your brand

You want to generate MORE social media fans and keep them engaged. So, give ‘em what they want.

How Social Media Fans Create Value

Social media fans create value because everything they say in social networks echoes throughout their network, expanding quickly.

If you have 1000 followers and they each have 300 followers, you’ve now reached 300,000 consumers. And if just half of these consumers share your message with their network by commenting, sharing, or +1 in your message, you’ve reached 45 MILLION consumers. Transmitting a message that reaches 45 million TV viewers on prime time TV would cost somewhere between $150,000 – $400,000 per 30 second spot. Add another $350,000 to produce the commercial and you’re talking some serious money.

So, we want lots of social media fans and we want them engaged with our brand.

Give Social Media Fans What They Want

How do you create a social media fan?

People become fans because you give them what they want. But, what is that?

Well, you could ask social media fans (fans, followers, circle …) what they want and that’s a good option. But, you’re likely to get either very generic type answers or stuff that’s too granular — I want to see video (generic) or I want to know more about xyz feature (granular).

So, what do fans want?

They want information — news about your product, how to use it, where it’s available, etc. But, they also want information not specifically about your product, but in a related area. I’m a fan of Howard University, where I work. They only post information related to what’s going on at the university — using it as a PR channel. Instead, they could share information about things going on in DC, where they’re located, or about African Americans, since its an HBCU, or about eduction, in general. They’re missing a huge opportunity.

They want to be part of a community - opportunities to build a real community are dwindling, but virtual communities (online) are gaining quickly because people like to be part of a community. Firms build a community by allowing others to have a voice in their social networks — for instance asking consumers about features they want in new products. Firms build community by responding to consumers and by engaging fans. Google is doing a good job of this in Google+, forcing Facebook to respond by creating Facebook for Business. Firms build a community by celebrating consumers. Dove is a good example of this with their program celebrating “real women” and campaign for self-esteem. The ads were hugely successful. California tortilla invited social media fans to comment on their new logo, resulting in a stronger fanbase, more engaged fans, and a logo that resonated with consumers better.

They want to be entertained. So, give ‘em a game or a cool ap. Look at the Progressive and State Farm apps for mobile phones. Now, they really don’t do anything all that useful and you’ll likely never need them, but the apps are cool and fun, so the apps are attracting customers. Music, games, video, infographics, and many other tactics make social media more entertaining, attracting fans and business for the firm.

They want status. Social media fans enjoy being the first to know things — they like the feeling of being in the inner circle. Starbucks offers lots of freebies, advance info on new products, coffee making tips, and other stuff ONLY to social media fans. Of course, fans share offers with their social networks, increasing the reach for Starbuck’s message and building a bigger fanbase. Taylor Swift uploads tracks f to her Facebook Fanpage before the albums are released in the stores.

Did I leave something out? What strategies does your firm use to build a bigger fanbase?

How can your firm use these 4 strategies to build a bigger, more engaged fanbase?

Brand Awareness

I say it would depend on the buyer persona for the loyalty programs. Where are the customers/prospects? Are they online? Where online? Depending on where these folks are, I would focus on that particular media, e.g. Facebook.

What is the biggest pain point for these customers/prospects? Create some good content that solves their problem.

What drives these prospects? Are they bargain hunters? In which case, coupons may work.

In summary, I would say it all depends on what drives the customers/prospects. Once you know their needs and their pain points, you can create content and programs to address these.

Marketing That Works

To me, brand awareness is more than where to reach customers, its positioning the loyalty program (and the brand) effectively. For instance, Marriott builds its loyalty program by asking loyal guests for feedback on their visit. If they rate their stay as anything less than perfect, the evaluation goes to the property manager. The manager than has 24 hours to correct the problem and make the customer happy. If not, the complaint is forwarded to the manager’s boss for action. By focusing on delivering quality (Marriott has around 97% customer satisfaction), they build loyalty.

Loyal customers WANT to join a loyalty program to get rewarded for something they already like doing (because its satisfying). I guess what I’m saying is the building a brand is a lot more than advertising and PR — its walking the walk.

Also, awareness doesn’t buy you much. Im aware of LOTS of brands I would NEVER buy. Its brand image that’s the goal. Having a positive brand image builds profitability.

At Disney, we did an “affordability” campaign, that had little to do with discounts and more to do with reminding people about how much love the brand.

Daily deals are addictive and though I’ve wanted to, I have yet to remove myself from LivingSocial or Groupon. That sure says something for loyalty.

Brand awareness and loyalty are completely two different beasts. For brand awareness, you could drop a LOT of money into a content-targeted campaign on AdWords, AdCenter, MIVA, and Ask.com, the way LiquidWeb is right now (they have a banner ad on almost every tech-related website in existence at the moment).

Richard Winfield Lewis To bring attention to a customer loyalty program (does branding really matter in this case as long as we gain customer loyalty?) is to target your existing customers first. This is an easy first step and helps to make casual customers regular customers. The next step is to target industry ‘influencers’. <– those people who influence a large number of other people. My goals when managing a campaign are very clear, do the least work with the most impact.

Paid PR

I’d love some advice on how to deal with a client who is in love with paid PR services. He keeps insisting on using them, even though they haven’t worked in the past. I’m trying to convince him that we need to create a more effective online presence via the website and content. (This is a fledgling business consulting company that he runs.) Any thoughts would be appreciated. Thanks.

Marketing That Works My tactic would be to gather metrics on his current solution, then show him how poorly these are performing. I know its a lot of work, but if you want to get him as a client, its worth it. Also, he’ll likely be thrilled you went the extra mile and recommend you to colleagues.

Nancy Loderick Thanks for the tip Angela. I like your idea. This client is a process/numbers guy so I think showing him numbers would get his attention.

Marketing That Works I happy to help. Let me know if this doesn’t work and I may be able to come up with another idea.

Hi Nancy, sorry it took so long to jump in today, the week has been crazy.

PR can be an extremely powerful way to build industry credibility, earn backlinks for SEO, and improve online reputation. Of course, this assumes it’s being done by a professional who gets your business featured in magazines, your directors get speaking gigs at conferences, and you’re interviewed by newspapers at least once per month. If you’re not, then it’s not really PR, it’s article distribution.

Hope this helps?

Marketing That Works Thanks Steve, always nice to get your perspective on things.

Dave Saunders Are you talking about traditional PR (i.e., sending a press release to the media, getting on CNN, etc.) or New Media PR (i.e., disintermediating the media and reaching the public directly with Internet content?

Nancy Loderick Hi Steve,
Thanks for your thoughts. In looking back at my client’s past PR content, it was not good. So, I think it has been a combination of poorly written content and merelyl a distribution.

Nancy Loderick Thanks for the examples Steve! Even if one knows what constitutes “good PR,” it’s helpful to have real examples.

Nancy Loderick Dave – to youir question about PR – traditional or new media. My client is only familiar with traditional (he’s in in 60’s), while my expertise is in the new media type.

Dave Saunders Nancy — I’ve found that to be a challenge with clients. The games are played in different ways. It muddies the waters. Perhaps you could recommend he read The New Rules of Marketing and PR. David Meerman Scott does a great job explaining the differences and then you can use a third party to reinforce the benefits of your approach.

Richard Winfield Lewis The oldest and best advice for any consultant is that you give them what they need and not what they want. Once you know the goal(s) and the target market(s) then just get them paying customers. That is the bottom line and all that matters. Once they see the money rolling in they won’t care how you did it. In this case I suggest micro-targeting to ensure effectivenss. Do whatever it takes to convert your target audience to sales. If you are not sure that you can delier results then don’t take their money.

Pivot

a business should pivot, or change something about it’s direction, if the current business model isn’t working

Cherie Tripp Lejeune

Saw a piece from Tech Cocktail files and it was from an Aaron Batalion (Livng Social founder) talk about the term PIVOT…companies like Paypal and even Aaron’s ventures, that started out as something else but morphed 100%..I thought it was an interesting way to label faulty marketing brackets to begin with. If you are someone who succeeded at in the digital marketplace at some point, I guess failure label can be dodged. How should one handle in their NEW business plans any prior flat schemes in order to attract new momentum and investors?

Nancy Loderick Hi Cherie, It is always fascinating to read about successful companies and the twists and turns they took. As for what to put into new business plans, how about a section on “lessons learned from prior ventures?” Be as specific as possible, and make sure the lessons related to the new venture.

Marketing That Works

I’m not so sure its failed marketing, so much as it is adapting to consumer needs — which is a great marketing plus. I once heard the founder from Adobe talk about starting his firm. He showed his bundle of software and hardware to Microsoft, Apple and some other players. They had hardware and just wanted the software. He wouldn’t sell it to them because his business plan called for selling the bundle. After 6 months of not selling anything, he discussed it with their mentor appointed by his VC and he told them to ignore the business plan — its just a tool to get the money. He did and look where Adobe is now.

Cherie Tripp Lejeune If your a newbie–and product limited life span anyhow, I like Nancy’s recommendation but stll think VC’s would be tepid at best. Think of App life today– maybe a hot 18 months?

Dave Saunders

When I ran a business incubator I saw a lot of business plans that were 100+ pages long and followed like they were religious texts. Those businesses usually failed because they couldn’t adapt to reality. A plan is nothing more than that: a plan. A successful business needs to start somewhere (which is why having a plan is good) and then must get into motion.

Cherie, great question! Amazing how one little Amazon.com offer can spiral a business into what LivingSocial is now.

How should one handle in their NEW business plans any prior flat schemes in order to attract new momentum and investors? Wow, there’s so many directions one could go in to answer that.

I will be honest, I’m not really sue what a flat scheme is, but I can tell you that it doesn’t take one person to write a new business plan, it takes about 20, particularly on the marketing side of things. I’ve compiled time, labor, resources, experts, and estimations from search engine marketing for many businesses in the past, and recall having to to pay for a quote and strategy from experts in each field. Real experts, not self-promoted ones. Each strategy has it’s own estimates as well.

Once you have the best possible strategy handwritten by the experts in each field, it’s not too difficult to apply the milestones and tasks under each milestone to a project management system. It’s also not too hard to get funding.

My prior post covered the first half on How to Create A Marketing Plan. Today, I’m covering the second half of how to create a marketing plan. Specifically, we’ll be covering using findings from the situation analysis to develop a marketing strategy that helps you reach your objectives. The last part of this series will show you how to develop an implementation plan and elements to measure to see your progress in reaching your goals.

Strategic Plan

Linking findings from the situation analysis to your strategic plan is critical. Developing plans without these insights or with incomplete or inaccurate insights means you’re missing some opportunities to make money and may even fail because what you’re doing aren’t the right things. Opportunities and threats identified in your situation analysis can be used to guide development of new marketing strategies while weaknesses uncovered in the situation analysis should be fixed to the extent possible in your strategic plan.

A strategic plan only contains elements of the 4P’s — or internal elements including Product, Price, Promotion, and Place (or Distribution). You can get a better idea of these elements from my earlier post.

Product Strategies

Issues involved in managing existing products dictate some strategies likely to be more successful. Among these issues are (we’ll cover each of these topics in future posts):

Product life cycle

Product class

Product form

Product positioning

A major focus of managing new products is the issue of branding. A brand is like a hologram — not real in a tangible sense but clearly “visible” to consumers. Another way of looking at branding is as a personality for the product. Companies can about their brand because it is this personality, more than any other aspect of the product, that controls buying decisions. Its just like with friends, you have many with different personalities, but all have something about their personality you find attractive. When a brand appears to be “for me” I want the product and when brands are “not for me” I avoid them.

Brand image (or brand personality) comes from advertising and other promotional efforts, from where you see the brand sold and who you see using the product, and from what friends say about the product. In a world dominated by social media, increasingly it is these non-commercial communications that control brand image.

The internet is becoming increasingly crowded with promotions because of their reach and low cost. However many firms fail to recognize promotions in online environments, especially social spaces, are fundamentally different than traditional media because they require customer engagement.

An important element of promotional strategies is the integration required to maximize effectiveness. Hence, rather than choosing a single medium for your message, a firm must use multiple outlets in a coordinated fashion. You might use cause marketing as a basic strategy to promote your business, get fans and followers on board to support the cause by retweeting your message, liking your fanpage, or sharing your message with their social network. You reinforce the message using traditional advertising and evoke PR to tell everyone about the program and what a socially responsible company you are. You might offer premiums like t-shirts to consumers who promote your cause. Everything would be integrated using the same message, similar graphics, and the overall strategy.

Price Strategy

Many business people think consumers want the cheapest product available, but this is often wrong. What consumers really want is value — which is the difference between price and benefit. Price also tells us lots about the product, especially when its difficult to judge the quality objectively. For instance, we assume a diamond ring that is more expensive is a better quality diamond. We figure the same about a physician or hospital — that’s part of the healthcare system that’s broken when we choose expensive physicians since we don’t pay for them ourselves.

Cialdini tells a story in his book on influence where a retailers couldn’t sell her jewelry so she DOUBLED the price and sold out — at the cheaper price it was considered junk.

Place Strategy

Distribution is an important aspect of marketing as much of the cost of many products is tied up in distributing it to the ultimate consumer. Place also has meaning for consumers as store atmospherics provide clues about the products sold at the store. Issues such as stock-outs, merchandising, store layout … also must be considered in developing your place strategy.

One of the most interesting opportunities in place marketing right now comes from integration of social spaces and retail spaces. Foursquare and Facebook places are among those linking these two domains. QR tags and Shopkick are changing the way retailers and other service business can merge social media, geolocation, and marketing into one powerful tool.

I hope you find this valuable. Next post we’ll finish covering How To develop a Marketing Plan. Meanwhile, join Marketing That Works, our training site, where we’ll be posting live case studies, step by step demonstrations of social media and marketing tools, and introducing detailed marketing tactics to help you make the most of your business. Sign up for our newsletters and our next webinar on Market Samuri at http://www.MarketingThatWorks.TV.

Yesterday, we had a very active session of “Ask a Marketing Expert” Friday. If you missed the discussions, they are available on my wall at http://facebook.com/angela.hausman. Although the forum is closed for this week, I will be hosting “Ask a Marketing Expert” every Friday on Facebook. Remember, its FUN… its FREE… its FRIDAY.

Many “Ask a Marketing Expert” questions revolved around using social media, ie. analytics for attaching ROI to your social media strategy, maintaining social interaction across your social media efforts, and tools for maximizing returns from your social media strategy. This may have been a function of my blog post of Thursday, which discussed 5 Reasons Why You Shouldn’t Use Social Network Marketing. This post also generated a good discussion on the Washington Connections group on LinkedIN. Another hot topic was the definition of marketing. This question, as well as questions differentiating marketing from advertising, PR, etc, is a frequent question that comes up on “Ask a Marketing Expert”. Its not just semantics, the issue of marketing’s definition is critical to the way businesses build their marketing strategy. If you have a definition you like, be sure to add it to our growing list of definitions.

Meanwhile, last week I posted instructions for building a perceptual map. Perceptual maps are a critical element in developing your brand strategy, as they show what consumers think about your brand, your competitors’ brands, and identifies wholes where new brands might be introduced. Dr. Steven White, Professor of Marketing, University of Mass. Dartmouth and active blogger, posted a helpful comment directing readers to open source software that can help build the actual graphs in multiple dimensions. In addition to the more expensive software I suggested in the article, he suggests R, which is open source. I’ve included a link to their site.

In addition, last week I requested information from companies who would be willing to act as clients for my Services Marketing and Brand Strategy classes in the fall. I’ve received applications from several firms, but I could use some more. So, if you are a non-profit or know of a non-profit that could benefit from a free marketing plan, please have them contact me via comments to this blog. The application process takes 5 minutes and you’ll know if your non-profit was selected by the end of August. If you’re not selected this semester, I’ll have at least 1 class in the Spring that will need projects.

Finally, on a sad note, I ended the week with a case of plagiarism. Lest you think this trivial, Google punishes websites providing duplicate content. So, if your post is deemed to duplicate the plagiarized material, you will see your search engine rank decline as well as other analytics. So, lets stop doing it. Its also illegal and can destroy your credibility.

Yesterday’s marketing strategy introduced differences between products and services including intangibility, perishability, inseparability, and inconsistency. Today, I discuss specific marketing strategies for dealing with these differences.

2. Marketing Strategy – Implications

For the most part, marketing services involves addressing the differences listed yesterday, in many cases marketing them in a way that reduces these distinctions., making them more like products.

a. Strategies based on intangibility

Strategies related to marketing intangibles relate to making them more tangible. This may be done physically, like giving you a passbook to represent the money you have deposited in the bank. Or it might be done by linking some tangible element to your intangible services, such as linking a rock to insurance emphasizing the permanence by a slogan like “own a piece of the rock” used by Prudential.

b. Strategies based on perishability

Many of these marketing strategies revolve around pricing issues. Companies like Hotwire and Priceline were developed to implement pricing strategies in marketing travel services that have defined expiration dates. These services offer reduced charges for airlines, hotels, rental cars, etc. since large blocks of services expire at the same time. As these travel services approach expiration — close to departure time or the date of hotel usage — the service providers may market them through heavily discounts since getting something for that empty seat is better than getting nothing. This is especially true for industries with high fixed costs relative to variable costs. In these service businesses, whatever they get for the unfilled seat is mostly profit, which is a great incentive to drop the price.

In addition to pricing market strategies, service firms may use promotional marketing strategies to drive demand to fill unused services. Hence a firm might advertise heavily as the time for a concert nears to sell remaining tickets. If the concert sells out early, the company may do little or no advertising.

c. Strategies based on inseparability

These marketing strategies are the most comprehensive aspects showing the divergence between product and service marketing. These marketing strategies also demonstrate the overlap between marketing and management most clearly.

Inseparability means that how the service is performed is equally important as how well the service is performed, in most cases. For instance, on the inaugural cruise of the Norwegian Epic a number of problem occurred ranging from minor, such as publicizing events that didn’t take place, to technological, such as booking fee-based entertainment, then not admitting the guests because of a computer glitch, to mechanical failure, such as raw sewage backing up into a passenger cabin. Most of these market failures are an aggravation guest don’t expect to deal with on their much-anticipated vacation, but often occur, especially in a new ship. Certainly, part of marketing strategy is to minimize such events, but strategy requires that companies MUST train their employees on how to handle service failures and empower them to make the situation right.

The strategy involved in dealing with the passenger with the raw sewage backup dictates they be moved to another cabin, even if that means upgrading them to a much more expensive room or suite. If nothing is available, sound marketing strategy suggests they should have the problem fixed within a very limited amount of time and constant communication must be established to keep them abreast of the situation until it is resolved. They should also be offered a free cruise in the future or compensated in other ways for their inconvenience. Luckily, in this industry, there are a number of ways to provide compensation that have great value to the passenger, but little cost to the company, making them idea marketing solutions to service failure. Examples include priority seating at entertainment venues and restaurants., access to special areas reserved for passengers booking into penthouses and suites, tours of backstage areas of the ship, etc. Most importantly, they deserve respect and acknowledgment of the legitimacy of their complaint among personnel of the ship.

Instead, the relatively inexperienced crew did little to appease the passenger. The result was the passenger was increasingly likely to complain about other aspects of the cruise (which he did rather vocally) and spread negative word of mouth about his experience (which he did). When other passengers hear him complaining at the front desk or in the passageways of the ship, it informs their satisfaction evaluations making them less satisfied and making them more critical of service failures they directly encounter.
d. Strategies based on lack of permanence

Services can’t be inventoried. Services are created when customers want them, which means they may not be available when customers want them. Because consumers are likely to form dissatisfaction when they can’t obtain desired services or have to wait for them, companies need to develop capabilities to reduce wait times and/ or manipulate demand. Hence a bank might have additional staff assigned to handle the increased volume they experience at lunchtime or on Fridays so that customers don’t experience excessive lines. Disney and other theme parks have developed instruments such as “Fast Passes” that help reduce waits for popular rides by allowing customers to wait somewhere else, thus allowing them to engage in other activities during their wait rather than standing in line. Not only does this system create customer satisfaction through shorter lines, but allows customers to spend money rather than wait in line.

They might also reduce perceived wait time by giving customers something to occupy themselves while standing in line. For instance, Disney World has created movies and theme based queues that make waiting appear part of the attraction to reduce perceptions of waiting. These may also have a positive marketing result as when grocery stores use monitors to reduce perceived waits in checkout lines. These monitors can carry information such as recipes, or other information to encourage product purchase.

Importantly, for developing sound marketing strategy, products can’t be inventoried. They also can’t undergo quality testing prior to the customer experience. This guarantees there will be failures in service delivery. Marketing strategies for dealing with this are twofold. First, companies need to develop marketing processes and procedures that reduce service failure and train employees thoroughly on these processes. Second, they need to develop contingency plans for how to handle the inevitable service failure that does emerge as part of their overall marketing strategy.

For instance, airlines consistently experience service failure — either due to bad weather, mechanical failure, or traffic interruptions. They need to develop marketing procedures and processes to deal with those failures they can control. Foremost among these is communication that is honest and complete. How long do they expect the event to last? What are they doing to fix the problem? How will disruption affect the passenger with respect to connecting flights? What are travelers’ options?

If traffic routinely delays certain flights at certain airports, part of the marketing strategy may involve investigating re-scheduling the flight to reduce the impact of traffic or work with the airport and other airlines to reduce traffic or speed the flow of traffic. Another marketing strategy might involve stepping up preventative maintenance to reduce the likelihood of mechanical failure disrupting flight schedules. For other events, such as inclement weather disrupting travel, they need to develop a marketing strategy to address these delays that creates the least inconvenience for passengers..

Unfortunately, airlines have not sufficiently developed marketing strategies to address this issue and congress is now in the process of instituting policies for their industry. Not only is it undesirable to have the federal government involved in policing the industry from a publicity standpoint, it will likely involve more extensive and expensive restrictions than if the industry had developed internal marketing strategies to address these issue themselves.